Clunker Payment Woes Continue. Why Can't The Feds Get It Get It Right?
In apparent violation of the new cash for clunkers law, the DOT is more than 10 days late in paying rebates of millions of dollars on dealer claims.
Dealer clients in Metro NYC, Chicago and Southern California report the same frustrations they've had since the beginning of the program: Government website issues, confusing paperwork, rejections for procedural minutiae that they can't straighten out because Transportation employees are inaccessible by phone or email.
Perhaps most significant, dealers are not getting paid in the designated 10 days. Many worry the government will run out of money before their claims are paid.
The clunkers law signed by the president requires that dealers be reimbursed by the government within 10 days for $3,500 or $4,500 credits they paid to customers.
Adding to the confusion was a federal mandate that dealers dispose of the clunkers they receive in trade before they are reimbursed for them. Dealers ask, "what if the deal falls through, and the car is already scrapped?"
Also, another new wrinkle, dealers may now order eligible vehicles from the factory for customers, but must collect the clunker before the the deal can be submitted for approval, leaving the customer without transportation for weeks.
Another, the government requires a VIN to submit a clunker deal for payment. But it can take several days or weeks to obtain a VIN on a new order.
As of early Friday, dealers had submitted 358,851 clunker transactions worth $1.5 billion to the National Highway Safety Administrations' online system. But only a tiny fraction had been paid, the NADA and some state dealer groups said.
NHTSA is still trying to manage the end of the program so dealers aren't submitting deals for which there is no money.